Strategy Note /


    Stuart Culverhouse
    Stuart Culverhouse

    Head of Sovereign & Fixed Income Research

    Tellimer Research
    15 August 2017
    Published byTellimer Research
    Today’s statement from North Korea (DPRK) (that it will wait to see what the US does before taking a decision over Guam), coming after a more conciliatory tone from the US administration yesterday (an op-ed in the WSJ from Secretary Tillerson and Defence Secretary Mattis), may help to de-escalate the threat of conflict and reassure investors after a nervous few days. An outbreak of calm may be something to build on in terms of creating space for dialogue. Any thought of the impact on financial markets from an escalation of military conflict and, ultimately nuclear war, feels a bit callous and insensitive. We think there are two key transmission mechanisms on the global economy, namely trade and financial linkages (capital flows).